New Delhi: Hindustan Unilever on Tuesday said it is evaluating various options for the future of the ice cream business, following its parent Unilever’s announcement of a strategic intent to separate the vertical globally.
London-based Unilever announced that it intends to transform itself into a simpler, more focused and higher-performing company by separating the ice cream business, a move expected to result in a loss of 7,500 jobs.
When asked about the possible impact of the move on the Indian business, the Indian subsidiary (HUL) of Unilever said it is evaluating various options.
"As far as the Indian ice cream business is concerned, we are evaluating the various options in light of this announcement. We will discuss this with the HUL Board and Unilever management in the coming months. Once the approach is finalised, we will communicate further," said a HUL spokesperson in response to a query over the impact of Unilever’s decision on the Indian business.
Ice creams contributed 3 per cent or Rs 59,144 crore to HUL revenue in FY23.
"We have a very robust cost savings programme in HUL called Symphony, that we have been driving for many years now. Through an end-to-end focus across all lines of the P&L (profit and loss), we have been generating gross savings...every year. This provides us with crucial fuel for growth, allowing us to invest competitively behind our brands and future capabilities. We will closely assess the global initiatives of Unilever under the productivity programme and assimilate best practices to take Symphony to its next phase," the spokesperson said.
The ice cream business has an inherently different business model, including a cold-chain go-to-market operating model, seasonality, and a different innovation rhythm compared to the rest of Unilever's business, the HUL spokesperson added.
HUL operates in the Indian ice cream market with three brands Magnum, Kwality Walls and Cornetto.
HUL’s ice cream business comes under the Food & Refreshment segment, which represents 25 per cent of its revenue.
In its latest annual report, Unilever said: "Our ice cream business had a stellar year with strong performance led by innovations and brilliant execution."
Its ice cream business has helped HUL’s Foods and Refreshment vertical record strong performance in FY23, along with Foods and Coffee.
For expansion of the ice cream category, HUL was trying to 'de-seasonalise' by expanding consumption occasions through innovative campaigns and launching exclusive products, centred around Indian festivals.
Its Kwality Wall’s mobile vending initiative, 'I am Wall’s' had provided entrepreneurship opportunities to nearly 12,600 people and 250 differently-abled persons across India.